4:15pm: Markets signal earnings jitters
The Nasdaq managed to hold onto its gains on Friday, ending the day around 0.1% higher.
Next week will be a big test for the tech-heavy index, with Apple, Amazon and Alphabet all set to report earnings.
The Dow ended the day 0.6% lower and lost around 2.5% during the week.
The S&P 500 finished right around the flatline on Friday, but lost 0.9% for the week.
2:25pm: How's the US dollar looking?
The US dollar is experiencing a pause after a recent rebound, as traders remain cautious amid ongoing concerns regarding the manufacturing sector, which continues to contract despite some improvements in recent data, according to George Pavel, General Manager at Capex.com Middle East.
"The manufacturing sector remains under pressure, and the anticipated 1% decline in U.S. Durable Goods is adding to the cautious outlook," Pavel noted.
Traders are awaiting today's Durable Goods data, which could significantly influence market sentiment. "If the results come in weaker than expected, the dollar could come under pressure as traders factor in the impact of lower sales on production levels and economic growth," he added.
Looking ahead, next week’s critical reports, including GDP growth, core PCE, and Non-Farm Payrolls, will play a key role in shaping the dollar's future.
"If we see stronger-than-expected data reflecting a robust economy and a healthy labor market, the greenback may find renewed momentum," Pavel stated. However, he cautioned that "uncertainty surrounding the upcoming elections could limit any potential gains."
1:05pm: Stronger economics, tighter spreads
The market's upside is being fueled by stronger economic conditions and narrower credit spreads, according to analysts at UBS.
Investors see the reduced likelihood of Federal Reserve rate cuts as a positive sign of economic robustness, the analysts wrote in a Friday note, adding high yield spreads have tightened from 3.2% to 2.9%, reflecting a reduction in risk.
Analysts also highlighted research that suggests stock prices are more responsive to changes in credit spreads than to short-term interest rate fluctuations.
12:05pm: Dow falls
Markets were mixed by the midday point Friday after experiencing a morning rise.
The Nasdaq continued its early morning strength, trading 1.2% higher, while the S&P 500 was up by 0.5%, breaking a three-day losing streak.
The Dow Jones was not so lucky, however, turning negative by midday Friday and losing around 0.2%.
The general upward trend in Wall Street came as Treasury yields fell, easing some pressure on risk appetite. The benchmark 10-year yield decreased to approximately 4.19%, down from a three-month high of over 4.25%.
However, both the Dow and S&P 500 still appear poised for downbeat weeks after suffering a hard hit from the surge in yields, amid concerns that the Federal Reserve will be slow to cut interest rates.
10:50am: Manufacturing faces new headwinds
U.S. durable goods orders fell by 0.8% in September, raising concerns about a possible slowdown in production and the broader manufacturing sector, according to Quasar Elizundia, Expert Research Strategist at Pepperstone.
"Although the data is relatively better than expected, with the underlying component showing a 0.4% increase, this is the first ‘negative’ news contrasting with a series of more optimistic figures reported by the U.S. economy in October, including increases in employment, job vacancies, ISM services PMI, and retail sales," Elizundia wrote.
"The contraction in durable goods orders continues to pressure the manufacturing sector, which still remains in negative territory despite some improvement compared to the previous month. These challenges emerge amid a strong labor market and expansion in other sectors, highlighting an economy that remains resilient despite certain areas of weakness."
That said, the decline in U.S. durable goods is unlikely to influence the Federal Reserve’s less aggressive approach to rate cuts, a trend that has weighed on Latin American currencies, Elizundia added.
The sector's volatility is highlighted by contrasting figures, with August orders revised down after July's largest increase in four years, complicating the outlook for manufacturing recovery.
9.50am: Wall Street sees bright start
Wall Street enjoyed a broadly positive start on Friday as the market looked to close out a volatile week on a better note.
The Nasdaq jumped 0.8% as the market opened, while the S&P 500 and Dow Jones added 0.5% and 0.3% respectively.
This came as benchmark 10-year treasury yields continued to trend lower on Friday to 4.18%, having climbed to a three-month high in excess of 4.25% earlier in the week and in a blow for equities.
It also followed figures showing US core capital goods orders exceeded expectations in September, rising by 0.5% against an anticipated 0.1%.
Durable goods orders slipped by 0.8% in the meantime, weighed down by a drop for transportation equipment.
7.30am: Stocks seen higher
A brief quiet period on Friday looked to have Wall Street on course for a better start to the day.
Futures had the Dow Jones up 0.1% ahead of Friday’s opening bell, after its latest drop on Thursday, while the S&P 500 and Nasdaq looked set to tick up a further 0.2% each.
Both had been aided by a 21% jump in Tesla Inc shares following expectation-beating earnings, which added close to US$150 billion to its market capitalisation.
This came after a surge in treasury yields earlier in the week had put pressure on stocks as markets priced in growing expectations of a win for Donald Trump in next month’s election.
Friday looked to bring a quieter day on Wall Street, with 10-year Treasury yields falling back to 4.19% after hitting a three-month high above 4.25% earlier in the week.
Aon PLC (NYSE:AON) was among the few to report, with shares ticking up 2.3% in pre-market trading after it unveiled a 7% increase in third-quarter revenue to US$3.7 billion.
“With risk events swirling over the horizon next week - including mega-cap results from five of the ‘Magnificent 7’; highly crucial US payrolls data on Friday; and the final lap leading up to a potential photo-finish US presidential election on November 5 - this relative quiet feels like the eye of the storm,” Tickmill Group partner Patrick Munnelly said.